Senate Passes Drugmaker User Fee Bill

WASHINGTON -- The Senate voted 96-1 Thursday to pass a bipartisan bill that would reauthorize FDA user fee programs for the drug and device industries. The bill also would create new user fee programs for generic and biologic drugs.

The current user fee agreements with the drug and device industries are set to expire at the end of September. Without the renewal of the agreements, the FDA would be forced to lay off staff members and would fail to keep up with the growing number of new drug and device applications, the agency has said.

The House must now pass its version of the legislation, and is expected to do so as early as next week when House members return on May 30 from Memorial Day recess.

One piece of the massive FDA user fee legislation would reauthorize the Prescription Drug User Fee Act (PDUFA), the popular program that charges drug companies fees that help fund the FDA's drug approval programs. Since PDUFA was first passed in 1992, it has become the major revenue stream for the FDA's drug review programs, with user fees funding 62% of the agency's drug review expenses in 2010.

Funding from PDUFA also has enabled the agency to hire more staff, and it has been hailed as a success by those who point to the shorter drug review times after PDUFA.

The newest version of PDUFA would increase industry user fees by 6% in exchange for improved communication with the agency and greater consistency in the drug approval process.

The updated MDUFA agreement would allow the FDA to more than double the user fees it collects from device manufacturers, giving it $595 million in user fees from 2013 to 2017.

The boost in fees will allow the agency hire new reviewers, which will lead to shorter wait times for FDA approval of new devices, Jeffrey Shuren, MD, the head of the FDA's Center for Devices and Radiological Health, told a congressional panel in February.

The long waits for device approvals have been a major gripe in the medical device industry, which says the FDA's slow and inconsistent approval process is stifling innovation.

The user fee bill also creates new user fee programs for two industries that don't currently have such agreements: the generic drug industry and the generic biologics industry. Those agreements both aim to bolster the safety of the supply chain and offer incentives aimed at encouraging generic companies to conduct pediatric studies of their products.

The deal with the generic industry would allow the FDA to collect about $299 million a year from generic drugmakers. Generic drug trade groups have called on the FDA to step up its inspections of foreign drug plants, and the collection of the user fees will largely go toward increased inspection of foreign plants, which is where 80% of all ingredients in drugs sold in the U.S. are manufactured.

The generic drug user-fee deal will likely also lead to the hiring of more inspectors, which could cut down on the average 31 months needed to approve a new generic drug.

The user fee agreement with manufacturers of generic biologics, or biosimilars, is less defined, because the pathway for approving biosimilars is still being worked out. That section of the bill -- known as the Biosimilar User Fee Act -- would at first be funded with $20 million annually from the federal government to hire new FDA staff and set assist in setting up a process to review and approve generic versions of biologics.

The bill also contains a provision that would require drug manufacturers to give the FDA early warning if the company foresees a potential drug shortage.

The lone vote of dissent on the measure was Sen. Bernie Sanders (I-Vt.)

"The most pressing prescription drug issue in our country today is that Americans pay, by far, the highest prices in the world for their medicine and millions of people cannot afford the medications their doctors prescribe," Sanders said in a statement. "I voted against this bill because it does far too little to address this crisis while it perpetuates a prescription drug system that continues to fail the American people."

Before passing the bill, the Senate rejected several amendments Thursday, including a bill sponsored by Sen. John McCain (R-Ariz.) that would have allowed Americans to buy cheaper drugs from Canada; one by Sen. Jeff Bingaman (D-N.M.) to discourage "pay-for-delay" deals where a brand-name drugmakers pays a generic company to delay bringing the generic to the market; and an amendment by Sen. Dick Durbin (D-Ill.) that would have required makers of dietary supplements, including energy drinks, to register their products with the FDA.

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